I have worked in PE as an analyst, then an entrepreneur. I'm a partner in several SaaS companies and one SaaS venture builder. We are getting a lot of deal flow from SaaS businesses looking to sell or cash out.
We are raising a fund in 2021 to offer both buyouts and revenue sharing to these companies looking for an exit.
I am preparing our investor documents, waterfall, pitch deck, legal documents etc.
I'm wondering would anyone have an investor deck for a Micro PE or LMM fund they would be willing to share privately?
No, but happy to try and answer any questions. What type of investors are you targeting?
We are looking to raise a small $5 million fund (or even go deal by deal holdco direction) to start. So we are not looking at institutional investors.
We assume that presenting the potential waterfall, the P&L for a typical deal, show how we compress costs and improve the bottom line.
What documents would be needed here?
If we stay under $5 million I assume we can limit our reporting due to new fundraising rules starting next month.
Thanks, the comments below provided by others are more helpful as my experience is institutional.
Keeping that in mind then typically we see a pitch deck, PPM, LPA, sub deed and side letter. In your case, you probably want to your pitch deck or PPM to do most of the heavy lifting.
Would also recommend not defaulting to a 2/20% model if you can. $5m isn’t enough to cover costs and if you are also the biggest LP then you are paying the biggest portion (depending on how the fee arrangement for the manager as an investor is set up).
Not LMM but here is a sample pitch deck.
http://data.treasury.ri.gov/dataset/c7b93260-f9c7-4b76-87e5-3c68e931026…
If you're raising a micro-PE fund, the deck won't matter much depending on who you are pitching as your investors will be quite warm & unsophisticated. You mentioned above that target is ~$5M. At that size, I would 100% keep it simple and ignore most of what you see in decks for institutional capital.
Probably want to address:
a) Track record
b) Strategy - sourcing, value creation etc.
c) Fund mechanics/terms. Include a spreadsheet for your potential investors to play with. Make it as easy to play with as possible.
Given your target size, you're probably able to raise the majority via warm introductions or your own network? Throw in ~$1M - $2M between yourself and any partners, then another $2M - $3M from ex-partners, vendors, other entrepreneurs etc?
If your investing track record is weak, most professional LPs will not really give a fuck about your entrepreneurial experience. I would focus on raising from other entrepreneurs, especially if your strategy is unique in any way and you aren't just raising a generic buyout fund. In particular, entrepreneurs will significant exits in your space...they can add value and will write a check quickly if your strategy makes any sense at all.
Feel free to PM me btw, have looked at quite a few micro-PE decks & very very familiar with the space. Would love to learn more about what you're doing too.
Edit:
Would recommend looking @ the ILPA site too. Loads of resources there.
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